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40 Cards in this Set
- Front
- Back
What are Products and Services?
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The essence of marketing is in developing products and services to meet buyers’ needs.
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product
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good, service, or idea consisting of a bundle of tangible and intangible attributes that satisfies consumers’ needs and is received in exchange for money or something else of value
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Good
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has tangible attributes that a consumer’s five sense can perceive
Example- Apple’s iPad |
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o Nondurable good
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is an item consumed in one or few uses, such as food products and fuel
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o Durable good
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one that usually lasts over many uses, such as appliances, cars and mobile phones
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Services
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- intangible activities or benefits that an organization provides to satisfy consumers’ needs in exchange for money or something else of value
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o Idea
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is a thought that leads to an action, such as a concept for a new invention or getting people out to vote
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o Product
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generally includes not only physical goods but services and ideas as well
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o Consumer products
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products purchased by the ultimate consumer
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o Business products
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products organizations buy that assist directly or indirectly in providing other products for resale (also called B2B products or industrial products)
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3 traits of Consumer Products
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(1) effort the consumer spends on the decision (2) attributes used in making the purchase decision (3) frequency of purchase
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4 types of consumer products
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1. Convienence
2. Shopping 3. Specialty 4. Unsought |
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Convenience products
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are items that the consumer purchases frequently, conveniently, and with a minimum of shopping effort
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Shopping products
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items for which the consumer compares several alternatives on criteria such as price, quality, or style
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Specialty products
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items that the consumer make a special effort to search out and buy
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Unsought products
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items that the consumer does not know about or knows about but does not initially want
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Business Product- Derived Demand
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sales of business products frequently result (or are derived) fro the sale of consumer products
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• components
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are items that become part of the final product
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• support products
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items used to assist in producing other goods and services
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4 types of support products and defs
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Installations- buildings and fixed equipment
Accessory equipment-as tools and office equipment Supplies-stationery, paper clips, and brooms Industrial services-maintenance, repair, and legal services |
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Product item
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a specific product that has a unique brand, size, or price
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o Stock keeping unit (SKU)-
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which is a unique identification number that defines an item for ordering or inventory purposes
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Product line
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a group of products that are closely related because they are similar in terms of consumer needs and uses, market segments, sales outlets, or prices
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Product mix
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all the product lines offered by a company
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3 ways to Classify servies
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1. People or equipment
2. Business firms or nonprofit organizations 3. Government agencies |
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Four I’s of Services
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Intangibility, inconsistency, inseparability, and inventory
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• idle production capacity
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when the service provider is available but there is no demand for the service
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Key organizational Problems that can cause new-product disasters
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Not really listening to the “voice of the consumer”
Skipping stages in the “new product process” • Skipping a stage often leads to disaster. This is why many firms have a “gate” to ensure that one step is completed satisfactorily before going on to the next step Pushing a poorly conceived product into the market to generate quick revenue • Focusing too much on quarterly revenue targets, causing an overlook in the network of services needed to support the physical product Encountering “groupthink” in task force and committee meetings Not learning critical takeaway lessons from past failures Avoiding the NIH (not invited here) problem |
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Stages of The New Product Process
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1. New-product strategy development
2. idea generation 3. Screening and evaluation 4. Business Analysis 5. Development 6. Market Testing 7. Commercialization |
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• Stage 1: New Product Strategy Development
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defines the role for a new product in terms of the firm’s overall objectives
o Firms use SWOT analysis and environmental scanning to assess its strengths and weaknesses relative to the trends it identifies as opportunities of threats. Outcomes define the vital “protocol” for each new product idea as well as the strategic role in might serve in the firms business portfolio. |
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• Stage 2: Idea Generation
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o Involves developing a pool of concepts to serve as candidates for new products, building upon the previous stage’s results.
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o open innovation
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is when an organization finds and executes creative new-product ideas by developing strategic relationships with outside individuals and organizations.
Customer and supplier suggestions Employee and co-worker suggestions Research and development laboratories Competitive products Smaller firms, universities and inventors |
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• Stage 3: Screening and Evaluation
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o Internally and externally evaluates new-product ideas to eliminate those that warrant to further effort.
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• Stage 4: Business Analysis
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o Specifies the features of the product that the marketing strategy needed to bring it to market and make financial projections
o A prototype is a full scale-operating model of the product. o Assesses the total “business fit of the proposed new product with the company’s mission and objectives Whether the product can be economically developed and manufactured to the marketing strategy needed to have it succeed in the marketplace o Requires detailed financial projections and assessments of the marketing and product synergies related to the company’s existing operations. |
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• Stage 5: Development
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o Turns the idea on paper into a prototype
Results in a demonstrable, producible product that involves not only manufacturing the product but also performing laboratory and consumer tests to ensure it meets the standards established for it in protocol o Safety tests |
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• Stage 6: Market Testing
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o Involves exposing actual products to prospective consumers under realistic purchase conditions to see if they will buy
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o Test Marketing
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Involves offering a product for sale on a limited bases in a defined area
Used to check elements of the marketing mix Sometimes skipped due to time consumption and cost |
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o Simulated test markets
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A technique that simulates a full-scale test market but in a limited fashion
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• Stage 7: Commercialization
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o The stage of the new product process that positions and launches a new product in full-scale production and sales.
o Most expensive stage for new producers |
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Regional rollouts
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when a company introduces a product sequentially into geographic areas of the United States to allow production levels and marketing activities to build up gradually to minimize the risk of new-product failure.
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